In the above figure, if the interest rate is 8 percent
A) people sell bonds so as to convert them into money.
B) people buy bonds and the interest rate falls.
C) the Fed increases the quantity of money.
D) people buy stocks, because stocks are more liquid than currency.
B
You might also like to view...
The continued position of the United States as the world's economic leader is:
a. assured b. predictable c. automatic d. uncertain
Increasing the reserve requirement ratio is
A) a contractionary policy because it lowers the amount of total reserves in the banking system. B) a contractionary policy because it lowers the amount of excess reserves in the banking system. C) an expansionary policy because it raises the amount of excess reserves in the banking system. D) an expansionary policy because it raises the amount of required reserves in the banking system.
Since it is a centrally planned economy, China does not face opportunity costs when economic decisions are made.
Answer the following statement true (T) or false (F)
In the figure above, with the rent ceiling
A) there is a shortage of 3,000 units. B) there is a surplus of 3,000 units. C) there is a surplus of 2,000 units. D) there is a shortage of 1,000 units. E) the market is in equilibrium.